Fear of US Government Closure When Chicken Debt Cap Game Begins | US Politics

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Up Democratic Party Republicans are expected to deliberately block temporary funding measures, according to two sources familiar with the proposal, causing a dual financial crisis: a huge US default and a federal closure. right.

The plan that the Speaker of the House is considering is Nancy Pelosi, And Senate majority leader Chuck Schumer includes suspending debt caps past the 2022 midterm elections A tentative bill to retain government funding until early December, sources said.

Democrats then dare to Republican To prevent filibuster from temporarily raising funds and not receiving the 60 votes required to pass the Senate. This could result in the government shutting down on October 1st, preventing the United States from paying the bill.

The United States has avoided defaults in most cases, and sources said they are hoping for some resolution on this occasion, even if negotiations last up to 11 hours, as in the last few years.

However, economists should not raise or suspend debt limits when tied to temporary financing measures, as the United States is unable to meet its debt in the midst of a potentially non-functional federal government. Says it is particularly devastating.

As Republicans criticize spending, one party now needs to blink to resolve the deadlock, which would normally be political football under the Democratic president.

The strategy of linking the catastrophic outlook for the U.S. to default at $ 28 trillion with government closures is in a difficult position after Republicans repeatedly refuse to raise debt limits in a bipartisan way. May be placed.

It also emphasizes the degree of parliamentary dysfunction as Republicans refuse to support the 9.11-style committee’s move from voting rights law to police reform. Investigate a deadly January 6 attack on the Capitol..

Treasury Secretary Janet Yellen recently said that if the United States defaulted in mid-October and Congress took no action, it could cause “irreparable damage” to the economy. , High stakes confrontation over debt caps is accelerating.

so Letter to PelosiYellen said the special measures the Treasury had taken to temporarily fund the government after the country’s debt reached its statutory limits on August 1 would be exhausted next month. ..

“When all available measures and cash on hand are completely exhausted, the United States will not be able to meet its obligations for the first time in our history,” Yellen wrote.

That meltdown could affect US credit ratings, raising concerns about rising financial interest rates, and US companies’ interest rates being benchmarked against financial interest rates, costing the government billions of dollars. Borrowing costs can be high.

Democrats have been arguing for months that Republicans will join them to deal with debt caps, arguing that the country’s debt is largely due to the Republicans. Approximately $ 8 trillion increase In the process of the Trump administration.

Pelosi added at a recent press conference that the need to suspend debt caps was partly due to tax cuts on the Republican wealthy. “We pay by credit card, Trump credit card,” Pelosi said.

But Senate Republican leader Mitch McConnell continues to categorically insist that Republicans don’t support it. Democratic Party Raising the debt cap as part of an independent bill, and instead that it should be included in a vast infrastructure package that can be passed by a partisan vote.

“Let’s be clear,” McConnell said in a tweet on Wednesday. “In the Democratic President, the Democratic House of Representatives, and the Democratic Senate, Democrats have all the tools they need to raise their debt limits. That’s their sole responsibility.”

Pelosi and Schumer also said they believed that the Democrats would join the Republicans to handle debt restrictions when President Trump was president, and that the Republicans should now return their support. ..

In emphasizing the point, Mr. Pelosi said the Democratic Party would not include a clause to raise the debt cap. $ 3.5 trillion budget resolution for Biden’s infrastructure agenda They intend to go through a settlement process to avoid filibuster.

Instead, top Democrats are planning to add such words to temporary funding measures that the government will continue to fund until December 3 or December 10, and the bill. Hope to convince 10 Senate Republicans to support.

Including debt restrictions in temporary measures is not final, sources warn and discussions will continue when House returns from summer vacation. For example, you can add it to a disaster relief bill or work on it alone.

Part of the concern of top Democrats is that the road to 60 votes in the Senate narrowed significantly last month after a majority of Senate Republicans signed a letter vowing to block a bill trying to raise debt caps. is.

Only four Senate Republicans, Senate Spending Committee Chairs Richard Shelby, Lisa Murkowski, Susan Collins, and John Kennedy, are well below the criteria needed to defeat the expected filibuster. So I refused to sign the letter.

Fear of US Government Closure When Chicken Debt Cap Game Begins | US Politics

Source link Fear of US Government Closure When Chicken Debt Cap Game Begins | US Politics

The post Fear of US Government Closure When Chicken Debt Cap Game Begins | US Politics appeared first on Eminetra.

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